A finding of a "discernable" improvement in police culture will be viewed as too sympathetic by many given the "Roast Busters" case, Labour says.
Deputy Auditor-General Phillippa Smith appeared in front of a select committee today to present her office's latest report into the police.
There was more to do, but improvements had been significant, Ms Smith said.
"We think that that there is discernable change, and we note too that the police have significant aspirations for what the future state of the organisation will be.
"Our sense is that the direction of travel is good. That the changes that police have put in place are beginning to take hold, and that they are heading in the right direction.
"Our message to them is...don't take the foot off the accelerator - you need to keep going."
The latest review focussed on police management of adult sex assault cases and misconduct in police, and Ms Smith said they also took the opportunity to address the wider issue of police culture.
It is part of a 10-year monitoring process that started after Dame Margaret Bazley's 2007 Commission of Inquiry into Police Conduct.
The inquiry received 313 complaints of sexual assault against 222 police officers, including 141 in which Dame Margaret said the evidence was strong enough to warrant criminal charges or disciplinary action.
Labour's Phil Goff questioned whether the review's largely positive findings were compatible with the Independent Police Conduct Authority criticisms of police following the Roast Busters case.
The Roast Busters were a group made up of predominantly West Auckland youths who allegedly bragged on a Facebook page about having sex with drunk and underage girls, some as young as 13.
An IPCA report, released last month, found numerous faults in police action after complaints about the young men's behaviour.
"There were multiple failures on behalf of the police in dealing with these sexual assault cases," Mr Goff said. "Is this [today's Auditor-General report] perhaps a too sympathetic report?"
"I'm trying to get a feel for, is this an isolated problem?...is it systemic?...It seems strange that one area should be failing so fundamentally, and that is just the exception.
Ms Smith said the incidents that gave rise to the Roast Busters report pre-dated her office's audit.
However, she re-read the IPCA Roast Busters report last night, and said it highlighted a failure to join the dots between related cases and information.
"The IPCA went out of its way to say that all of the officers involved took the needs of the victims very seriously.
"Where the failings came, as best as I could work out, was, so focussed were they on the victims, that they didn't look at the wider picture.
"What about the young men? They, in a sense, needed some help, because their behaviour was clearly beyond acceptable bounds. What about other young women that the young men might be dealing with? That didn't seem to come into it."
Ms Smith said correct processes were largely in place, but officers had failed to follow them. How that was dealt with would be crucial.
"The test for us would be - looking at a systemic level - is, and I can't answer this question, perhaps it's one to put to the [police] commissioner, given the IPCA's findings about the team who handled the Roast Busters, what have they done to fix it?," Ms Smith said.
"Because what we would be looking for, would be a pretty immediate response. And that's what a culture that doesn't tolerate failure should show you."
Police Commissioner Mike Bush said what was disappointing about the Roast Busters case was that a focus on prevention in police work did not occur.
"A problem-solving focus on how to deal with a small group of young men that were inflicting harm on young women and other women as well.
"We missed that opportunity early, and that's something as commissioner I'm determined to make sure that all of our staff...take that prevention, problem-solving opportunity at every turn."
The Office of the Auditor-General will present its final report on police conduct in 2017.